This year’s top crisis started when Russia invaded Ukraine. The consequences have been life-threatening for millions including refugees fleeing across Europe. The sanctions against Russian fossil fuel exports, have caused an energy crisis that has Europeans worried about staying warm coming winter. The blocking of Ukrainian grain exports is expected to exacerbate droughts and cause famines across the Sahel.
At the same time, the climate and sustainability crisis continue to steadily drive our planet towards a sharp cliff. On July 19, the UK experienced its hottest day on record with temperatures soaring over 40 degrees Celsius. It led to major disruptions. On Aug. 8, Seoul had the heaviest rainfall in over a century that knocked out power grids, submerged the metro system, flooded numerous homes and killed 14 people. And the list of climate-related catastrophes continues. Meanwhile, according to the UN, droughts have increased by more than a third this century and are currently affecting large parts of Africa, Europe, and China. Climate-related catastrophes are disrupting and seriously impacting the lives of millions of people. It is hard to imagine what else is needed to convince world leaders that this urgent crisis needs all hands on deck immediately.
A few weeks ago, US President Joe Biden signed the Inflation Reduction Act -- the most significant piece of climate legislation ever passed by the US. It put some $370 billion toward climate action. The World Resources Institute reckons that it puts the US’ target of reducing emissions by 50-52 percent by 2030 within reach. Looking at what is in the bill and what is not -- this is a compromise. The bill bets heavily on clean energy technology, largely through tax credits encouraging domestic technology development and production, but does not put a price on carbon. Electric vehicle subsidies only target domestic production, disadvantaging Korean carmakers. The per capita emissions will still be very much higher than those in India, even after a 50 percent emission cut. Furthermore, the absence of new money to honor the commitments made to developing countries will still be outstanding. While celebrated by climate campaigners in the US, there are some glaring omissions and negative side effects from an international perspective. In short, the IRA is a necessary, but far from sufficient step in the right direction.
What we truly need is a rescue mission to save planet Earth. And the solutions are right in front of us.
Powering Past Coal Alliance members in Asia are perhaps the most important part of the climate fight. Phasing out coal in Asia as rapidly as possible is critical to preventing average global temperature from reaching 1.5 degrees Celsius above pre-industrial levels. Unfortunately, the Ukraine war and consequent energy crisis is leading to a revival of the coal sector with record profits for a small group of large coal mining companies. This has led UN Secretary-General Antonio Guterres to slam the profits in the fossil fuel sector as “immoral “and “excessive,” and to call for windfall taxes. Leading countries in the PPCA such as the UK and Canada are looking for Korean support to help convince Asian partner countries to accelerate the clean energy transition and move away from coal.
For the time being, the issue is facing serious headwinds. The most positive news could potentially come from a new initiative, the Just Energy Transition Partnership. The JETP led to a deal announced at COP26 of some $8 billion for South Africa to help accelerate its transition away from coal. Several Asian countries such as India, Indonesia and Vietnam are looking to secure a similar deal at COP27. For the time being, high coal prices imply difficult discussions. A bit more positive news relates to methane emission reduction in the Association of Southeast Asian Nations countries. Following the international commitment to reduce methane led by the US at COP26, Korea agreed to lead and support such action for the ASEAN region. At the UN General Assembly in New York this month, South Korean President Yoon Suk-yeol committed strong support from Korea for international action to achieve carbon neutrality and to green Korea’s official development assistance, or ODA. Korea is in an excellent position to lead the drive to carbon neutrality in Asia.
Adapting to climate change in Africa and Small Island Developing States is expected to be the number 1 issue at COP27 in Egypt this November. Global Green Growth Institute member countries such as Fiji, Vanuatu, Rwanda, Senegal, Burkina Faso and more will point to the lack of climate finance put on the table by developed countries to meet the $100 billion commitment. It has also become clear that that sum is nowhere near enough to meet the needs of vulnerable countries to build resilience, create green jobs and meet the aspirations of their youth for a sustainable future. Many developed countries like the UK, Denmark and others may prioritize adaptation in vulnerable countries for their ODA resources, but financing adaptation is still underemphasized in the financial flows linked to climate. Relying on ODA resources alone is not going to change this. Finding ways to mobilize green investments for adaptation projects in vulnerable countries, involving the private sector, particularly -- but not exclusively -- Africa and Small Island Developing States in the Pacific and Caribbean, is a clear priority for coming years. While these countries did not cause the climate crisis, and do deserve support, they also represent an enormous potential for green growth and commercially attractive investments. Green ODA can and should be targeted here, while also leveraging the private sector to come along.
The Amazon has a critical climate regulator role as a massive carbon sink but now it is now emitting more CO2 than it can store due to deforestation, often through burning. Tropical forests like the Amazon are also treasure chests of biodiversity and the primary source of livelihood for indigenous populations. Unfortunately, deforestation rates in the Amazon remain at an all-time high. News, particularly from Brazil, remains grim -- with announcements of new highways through key parts of the remaining forest. Innovative solutions are key here. Colombia’s new president, Gustavo Petro, for example, called for a debt-for-nature swap to help Colombia protect its forest resources. Debt-for-nature swaps are financial transactions in which a portion of a developing nation's foreign debt is forgiven in exchange for local investments in environmental conservation measures.
GGGI is developing a large debt-for-nature swap worth $800 million for Ecuador, and this option is also being explored for several other countries. This and other initiatives will be key in saving the Amazon and we all must stand together to ensure its survival.
The world is seriously unprepared to deal with the climate change impacts we already face. Nevertheless, viable green growth solutions are available. These will require international solidarity, but will also present business opportunities and create green jobs. We must act now to deliver on our potential and safeguard the future for this and the next generations.
Frank Rijsberman is the director general at the Global Green Growth Institute, based in Seoul. The views reflected in the article are his own. --Ed.